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Knight Capital Managing Director Peter Kenny and Trading Advantage President Larry Levin on the outlook for the markets.
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I don't think that's a -- while Peter feels folks aren't going on vacation next week and that's namely that people -- the -- in the Federal Reserve board of course they're going to be Jackson Hole with their.
Big week gap how -- -- and we also of course have the Republican.
Convention taking place down in Florida and a lot of questions about what the Fed it's gonna did not like it or not the notion is out there.
That if theories of fed move significant fed move to print more money.
It is a bid to get President Obama reelected it's out figured look at at the headlines we talked to Richard Fisher from the Dallas fed about that first of all.
Is there any substance to that charge at all and if so might it actually affect Fed's actions in September.
I don't think it's gonna affect the Fed's actions because.
I think client large rear of the unique situation here in terms of the economy with QE1 QE2 would then fed an Operation Twist.
Having done largely what the Fed was expecting not entirely but largely what the Fed was expecting.
Any notion that there would be further quantitative easing will be predicated upon that historical precedence.
So I do think that this is this sense that any action on the Fed's part.
Would be viewed as an an aide to President Obama but I don't think that that's that's that's commonly shared on the street.
Well everyone's gonna handicapped batter make their -- -- there's nothing to be done about that but in the if you talk to anybody whether it's Richard Fisher -- a frequent guest on this this show.
Or any of the other people who are involved in the Fed that they say they are.
Virulently.
-- nonpartisan they are looking at the Fed -- -- we can only believe what they say or be totally cynical nonetheless Peter.
Do you feel that -- when it took cynical I don't know it was a -- -- -- -- other that he is David and I sit there and commercial breaks and think the world's gonna -- but we're not really were pretty much optimist but would you Peter than say.
The people should remain long in equities going into the fall.
Well that trend is your friend him with an election cycle that we're where there were in the midst of and getting deeper into as the days go by.
This is a net positive for equities if you couple that with the the inflationary impact on price discovery which is provided for by quantitative easing or easy money.
Coupled with the a very -- concerted and coordinated global effort by central banks to do the same thing.
Globally there is there is -- rise in the price of of equities as a result of all three of those and together quite positively however there are still risks on the horizon.
We use a huge risk.
Our our domestic economy is not exactly all you know over roses I mean we have a very elevated levels of unemployment we have a GDP this between 11 and a half percent one point 7%.
-- there's not a lot here that gives some equity markets in and of itself.
Room tipped to be very very positive lemon -- just you know career and I just stop -- -- Peter because we had -- Hovnanian on -- -- of course remember a Hovnanian Enterprises housing and he was practically giddy.
About a new homes sales -- about the turnaround from his perspective in the housing market do you share his enthusiasm at all and housing.
And he truly is an iconic figure in that space and needs to be paid an awful lot of attention to and I also have some data that would support.
The notion that housing has bottomed in navy has caught a bit at least in the north east.
But we're still at very very depressed levels of not in terms -- not only in terms of pricing.
But in terms of overhang have we seen the worst I would -- -- we have have we seen a turnaround.
It's very likely.
But is -- -- a tremendous move to the upside with weak consumer confidence elevated levels of unemployment and serious issues about the health and resilience of this economic rebound.
There's an awful lot of headwinds in in spite of the fact -- -- is probably right.
Larry Levin let me just get the trader perspective you watch the flows in and out -- where was the most activity today.
I was definitely in the S&P that was definitely on the upside no question about it that it seems like was the last three -- -- -- -- I'm with you on Fridays we've always seen.
The markets finished higher and it's been really strong bid yeah right into the close I think you're gonna see the same thing by today's yes -- -- get right on the highest paid hater I'd be remiss if I didn't ask -- about.
Knight capital how was it doing it still hasn't recovered.
From that the huge drop in the stock value a couple of weeks ago.
How you guys do -- now.
They're back -- -- I can't really talk about Knight capital as a security point contagious what's been published in that is that where.
We basically regained all of our market share -- number one.
And every major market equity sector in the United States well good for you look our hearts go out he had we wish you the very best Peter thank you for government -- much.
Larry of course we're gonna see you a couple of of the.
